If you invested with the Defendants or Relief Defendants, please provide your contact information for the receiver (even if you have previously been in contact with the receiver).

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October 31, 2022

On October 31, 2022, the receiver filed with the Court his Second Status Report.


October 17, 2022

Important tax information for Seneca Ventures

Revised information for Seneca Ventures found here. Further analysis is needed with respect to some of the cash transactions, however, we do not believe these will have income consequences to investors.

We do not have revised information for Ikkurty Capital, LLC (Rose City Income Fund I) at this time. The type of income earned in Ikkurty Capital is still being analyzed.”

Miller Kaplan will prepare and file the Administrative Adjustment Forms as soon as possible. However, it will not be completed prior to the October 17, 2022 tax filing deadline.


October 13, 2022

Important tax information for Fund II

Under the Centralized Partnership Audit Regime, Rose City Income Fund II LP (the “Partnership”) cannot amend its 2021 Form 1065, “U.S. Return of Partnership Income,” nor issue amended Schedules K-1. However, based on information obtained since the Partnership filed its tax return, the Receiver, in consultation with his tax advisors, has determined that adjustments are necessary. Consequently, an administrative adjustment request (“AAR”) will be filed with the IRS. The partnership will issue Forms 8986, “Partner’s Share of Adjustment(s) to Partnership-Related Item(s),” when and as appropriate.

With the caveat that the Partnership CANNOT – and IS NOT – issuing amended Schedules K-1 for tax year 2021, you have the option of filing Form 8082, “Notice of Inconsistent Treatment,” with your tax return to notify the IRS that you are treating items differently than as reported to you on your Schedule K-1. The information provided below is intended to assist you should you choose to file Form 8082.

Please note that neither the Receiver, nor the Receiver’s tax advisors, can provide partners with tax advice. Nothing herein is intended to be, nor should be relied upon as tax advice. Please consult your tax advisor.

The information provided here relates to the adjustments that the Partnership has identified and that will be reported on the AAR. The line items below refer to the lines on your 2021 Schedule K-1. The description below is provided for your reference only and, again, should not be relied upon as any representation as to how you should treat such item(s) for tax purposes. Your partner number can be found in the upper lefthand corner of your K-1.

The spreadsheet relates to Rose City Income Fund II only. We are working on preparing and providing additional information for Seneca Ventures, LLC and Ikkurty Capital, LLC (Fund I). We will post the new information when it is available, however, we are unable to promise a date upon which it will be completed.

11I – Other Income

13W – Amounts reported on this line are portfolio expenses. Such expenses were formerly deductible subject to the 2% AGI limitation. However, the Tax Cuts and Jobs Act suspended the deduction of these IRC § 212 expenses for federal income tax purposes.

M-1 Adjustments – Deferred Rebase Rewards – These amounts are not reportable as income in 2021. However, income must be recognized upon disposition of the rebase tokens. Shown for reference only.

M-1 Adjustments – Unrealized losses – These losses have not been realized and will be deferred until a taxable transaction occurs. Shown for reference only.

Ending Capital – The ending capital matches the ending capital on investor statements provided by Intertrust. Please note that the ending capital account on your Schedule K-1 will be different because – beginning in 2020 – capital accounts must be reported on Schedules K-1 on a tax basis. Consequently, the deferred rebase rewards, as well as the unrealized losses, will not be reflected in the capital accounts as reported on your Schedule K-1.


October 12, 2022

Updated: Questions and Answers Regarding the K-1s and Tax Returns
We understand that many of you have questions regarding the K-1s you received. Neither the accounting firm retained, nor the Receiver can give you tax or legal advice. Nonetheless, below are answers to some of the common questions we are receiving.

Q1: How much of the income on line 11 was related to rebase and how much related to staking?
A1: We recently received information we can use to break down the income and intend to prepare a spreadsheet document providing individual information for your use. The receiver is taking the position not the report rebase as income in 2021, but the staking income will be treated as taxable. This will be reflected on Form 8986 once issued.

Q2: If I choose to file Form 8082, can you help me provide updated information that I can use to fill out the form?
A2: We are working on uploading a spreadsheet that will provide updated information that can help you with Form 8082 if you choose to file this. We cannot provide you with tax advice or assist you in the preparation of your return, including but not limited to Form 8082 should you choose to file such form.

Q3: I was not an investor for the entire year, was that taken into consideration when preparing the K-1s?
A3: Limited information was available at the time of filing. We have additional information now and we are working to determine whether your allocation needs to be adjusted based on the time period of investment.

Q4: I was receiving “interest” of 1.25% on my investment that I chose to reinvest, is this reflected as income on my K-1?
A4: We do not have sufficient information about this arrangement to determine its character. However, your K-1 does not include any income related to this 1.25% of interest. Please consult your tax advisor as to the treatment of this amount.

Q5: Why is there such a large discrepancy between the net income shown on the investor statement and the amount reported on my K-1?
A5: The net income number on your investor statement includes large unrealized losses that cannot be taken into consideration for tax purposes until realized.

Q6: Will the returns be amended?
A6: Partnership returns can no longer be amended. However, an administrative adjustment request can be filed with the IRS and any changes will be reported to partners on Form 8986. The changes reported on this form will be reported on the partner’s returns in the year the form is received. If you do not agree with what is reported on the K-1, you have the option of filing a Form 8082 alerting the IRS that you wish to report items differently than the way they were reported to you on your schedule K-1. Please consult a tax advisor.

Q7: What does the income in Box 11I of my K-1 represent?
A7: This is cryptocurrency income earned by the partnership through mining and staking in 2021.

Q8: Why is there taxable income to me if I did not receive any distributions?
A8: A partnership is organized as a flow through entity that is not taxed at the partnership level. Rather, the income flows through to the partners who include it in their income tax returns. Income that the partnership earns is taxed to the investors whether or not this income is distributed to the partners.

Q9: It is my understanding that we did not sell cryptocurrency and there are not realized gains?
A9: Based on the information received from Intertrust Group, there were some cryptocurrency trades that generated losses overall in 2021. These losses are reported in box 9a of your K-1.

Q10: My K-1 lists distributions for 2021, are these taxable?
A10: Distributions shown in Box 19A normally are not taxable to you unless you do not have enough basis. They represent a return of capital or distribution of previously taxed income. Please consult your tax advisor.

Q11: Will the K-1s be amended?
A11: Partnership K-1s can no longer be amended after the due date of the partnership has passed. However, an administrative adjustment request can be filed with the IRS and any changes will be reported to partners on Form 8986. The changes reported on this form will be reported on the partner’s returns in the year the form is received. If you do not agree with what is reported on the K-1, you have the option of filing a Form 8082 alerting the IRS that you wish to report items differently than the way they were reported to you on your schedule K-1. A link to the Form is: https://www.irs.gov/pub/irs-pdf/f8082.pdf. Please consult a tax advisor.

Q12: We did not receive income, what options do we have?
A12: The IRS has issued the following guidance to assist taxpayers who are victims of losses from Ponzi-type investment schemes.

Q13: Why won’t you issue corrected or amended K-1s?
A13: Under the Centralized Partnership Audit Regime, the partnership cannot amend its return or issued amended K-1s. If the partnership determines that adjustments are necessary, it will file an administrative adjustment request with the IRS. The partnership would then issue Forms 8986, “Partner’s Share of Adjustment(s) to Partnership-Related Item(s). If you do not agree with what is reported on your Schedule K-1, you have the option of filing a Form 8082 notifying the IRS that you wish to report items differently than as reported to you on your Schedule K-1. Please consult a tax advisor.

Q14: Were the accountants aware of the performance fees charged and were they considered?
A14: The accountants did not have sufficient information to report performance fees when the tax return was filed. These fees may be reported on Forms 8986 (see above), if applicable. Regardless, these fees are Internal Revenue Code § 212 expenses, which were formerly subject to the 2% of AGI limitation and which are no longer deductible at the federal level. Therefore, these fees would not provide a federal tax benefit. Please consult a tax advisor.

Q15: I received payments from a promissory note with Jafia, LLC and did not receive a 1099?
A15: Jafia, LLC is single-member LLC and treated as a disregarded entity for tax purposes. The Receiver does not have the detail from Jafia specifying who was paid interest, nor the amounts, for the short time in 2021 the Receiver understands this occurred. The Receiver will likely propose a plan that considers all payments in a money-in/money-out net-out-of-pocket analysis for purposes of determining distributions to investors.  The Receiver encourages you to consult your tax professional regarding your treatment of the interest payments on your tax returns.

Q16: What is the Line 11 amount on my K-1 comprised of?
A16: This was the gross cryptocurrency income reported to us by the fund manager. We have requested categorization of this gross amount (e.g., staking, rebase, mining, etc.), to determine whether an adjustment is required. We will also determine if any adjustments to the allocations to each partner are necessary when we obtain this additional information. If there are changes to what was reported on your 2021 K-1, they will be reflected on a Form 8986 for each partner (see above). Please consult a tax advisor.

We urge you to consult a tax expert.


September 21, 2022

K-1s are being mailed. Please check your mailboxes in the coming week. If you do not receive a K-1 by September 30, please contact the receiver.


August 8, 2022

On August 8, 2022, the defendants filed their answers to the Commodity Futures Trading Commission’s complaint.


July 18, 2022

On July 18, 2022 the Court entered an order imposing a preliminary injunction against the defendants.


July 11, 2022

On July 11, 2022 the receiver filed with the Court his “Temporary Receiver’s 60 Day Report.”


June 23, 2022

On May 25, 2022, the Court set a status hearing for June 23, 2022 (unless an agreed order for a preliminary injunction is entered beforehand). The time of the status hearing and dial-in information for the status hearing will be provided on this page when they become known to the receiver.


May 11, 2022

On May 11, 2022, the Court issued an order appointing James L. Kopecky as Temporary Receiver. Mr. Kopecky is represented by the law firm of Kopecky Schumacher Rosenburg LLC.


May 10, 2022

On May 10, 2022, the Commodity Futures Trading Commission filed a complaint in the United States District Court for the Northern District of Illinois, captioned Commodity Futures Trading Commission v. Sam Ikkurty a/k/a/ Sreenivas I Rao, Ravishankar Avadhanam, and Jafia LLC, Defendants, and Ikkurty Capital, LLC d/b/a/ Rose City Income Fund, Rose City Income Fund II LP, and Seneca Ventures, LLC, Relief Defendants, Case No. 22-cv-05465.

Information pertinent to the receivership will be posted to this site.

*Please note that the receiver cannot offer you legal or tax advice. For such advice you should contact a qualified legal or tax professional